What mechanisms are in place to keep the founders honest? I've seen many success stories on Kickstarter, are there any widely known failures?
(http://www.kickstarter.com/projects/527051507/hexbright-an-o...)
(http://www.kickstarter.com/projects/cwandt/pen-type-a-a-mini...)
There's the lockpicks, which I think are still in trouble:
(http://www.kickstarter.com/projects/schuyler/lockpicks-by-op...)
These don't show people wilfully defrauding funders. I think they show people being overwhelmed by demand, and unprepared for the problems of manufacturing hardware.
Design for manufacture is interesting and has many small tricky gotchas. Add in bizarre export rules and foreign languages and it's not surprising that hardware manufacture is difficult.